Figure 3-23
The graph below represents the various combinations of ham and cheese (in pounds)that the nation of Bonovia could produce in a given month.
-Refer to Figure 3-23.In the nation of Cropitia,the opportunity cost of a pound of cheese is 1.5 pounds of ham.Bonovia and Cropitia both can gain from trading with one another if one pound of cheese trades for
A)1.0 pound of ham.
B)1.4 pounds of ham.
C)2.1 pounds of ham.
D)All of the above are correct.

Question

Figure 3-23
The graph below represents the various combinations of ham and cheese (in pounds)that the nation of Bonovia could produce in a given month. 
-Refer to Figure 3-23.In the nation of Cropitia,the opportunity cost of a pound of cheese is 1.5 pounds of ham.Bonovia and Cropitia both can gain from trading with one another if one pound of cheese trades for
A)1.0 pound of ham. 
B)1.4 pounds of ham. 
C)2.1 pounds of ham. 
D)All of the above are correct.

Quizplus · Accepted Answer

Bonovia has an opportunity cost of producing 2 pounds of ham for every pound of cheese, while Cropitia has an opportunity cost of producing 1.5 pounds of ham for every pound of cheese. 
Therefore, if Bonovia trades 1 pound of cheese for less than 1.5 pounds of ham, they would be worse off as they could produce more ham by themselves. 
Similarly, if Cropitia trades 1 pound of cheese for more than 2 pounds of ham, they would be worse off as they could produce more cheese by themselves. 
The only possible trade that would benefit both countries is when 1 pound of cheese trades for 1.4 pounds of ham, as Bonovia would gain an additional 0.1 pounds of ham for every pound of cheese traded, and Cropitia would gain an additional 0.1 pounds of cheese for every 1.4 pounds of ham traded.

Figure 3-23 the Graph Below Represents the Various Combinations of Ham and Ham